BTC Rally Underway but $84K May Serve as Ceiling, Analysts Warn
Market experts indicate Bitcoin's upward momentum has commenced, though resistance at approximately $84,000 could limit further gains based on spot ETF average cost basis.
Cryptocurrency market experts have indicated that Bitcoin's (BTC) recent climb toward $78,000 signals that the "uptrend has began," though further price appreciation might encounter a ceiling near $84,000, according to multiple critical indicators.
Key takeaways:
- Bitcoin profitability metrics say that BTC has entered the early stages of a "real rally."
- BTC price recovery may face stiff resistance at $84,000, with a pullback likely.
Bitcoin profitability indicators point to rally commencement
The leading cryptocurrency's latest price recovery movement approaching $76,000 has propelled it beyond 26% above the sub-$60,000 multi-year trough recorded on Feb. 6.
This upward movement was matched by a rise in the Spent Output Profit Ratio (SOPR), which climbed to an eight-month peak of 2.87, following a decline to as low as 0.62 during the opening days of February.
The SOPR serves as an indicator utilized to determine whether individuals holding Bitcoin have realized gains or losses relative to their initial acquisition price. Historically, this measurement has identified short-term price floors for BTC whenever it reaches its nadir.
"The $BTC SOPR Ratio shows that $BTC has already broken out of the bottom and is rising," CryptoQuant analyst CW8900 said in a Tuesday post on X, adding:
"The bottom for $BTC was formed last February. The rally is already in progress."
In a parallel development, Bitcoin's Net Unrealized Profit/Loss (NUPL), representing the differential between aggregate profits and losses presently maintained by market participants, has turned positive for the initial time since the beginning of January.
This development implies that Bitcoin's downward trajectory has concluded, and the "real rally of this cycle has begun," CW8900 said in another X post.
These structural characteristics mirror circumstances observed during the nascent phases of prior bull market cycles, during which the NUPL rebounded from prolonged stretches beneath zero as Bitcoin commenced a sustained upward trajectory.
Concentration of 1.1 million BTC at $84,000 price level poses sell-off risk
Based on Bitcoin's cost basis distribution information, market participants currently hold roughly 1.1 million BTC at an average acquisition price of $84,000, establishing a probable resistance area. This clustering indicates numerous investors may liquidate their positions at break-even levels, potentially impeding Bitcoin's continuing upward trajectory.
As Cointelegraph reported, Bitcoin's immediate resistance is at $78,000, where the true market mean currently sits.
The US spot Bitcoin ETF cost basis at $83,100 is seen as the next key hurdle.
Market analyst AlphaBTC suggested the BTC/USD pair might experience additional appreciation to close the CME gap at $84,000, which formed during the initial days of February.
As Cointelegraph reported, a close above the $76,000-$78,000 resistance zone would confirm that the buyers are in control, clearing the path for a potential rally to $84,000.